Các yếu tố ảnh hưởng đến việc áp dụng hệ thống kế toán chi phí ở một số công ty du lịch được lựa chọn tại hà nội, việt nam

Thạc sĩ

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ThAi nguyen University Southern Luzon STATE University

Socialist Republic of Vietnam Republic of Philippines

THE FACTORS AFFECTING THE ADOPTION OF COST ACCOUNTING SYSTEM OF SELECTED TRAVEL AGENCIES IN HANOI, VIETNAM

A RESEARCH PRESENTED TO THE FACULTY OF GRADUATE SCHOOL

SOUTHERN LUZON STATE UNIVERSITY LUCBAN, QUEZON, PHILIPPINES

THAI NGUYEN UNIVERSITY S.R VIETNAM

IN PARTIAL FULFILLMENT OF THE REQUIREMENTS FOR THE DEGREE DOCTORAL IN BUSINESS ADMINISTRATION

Date of Birth : 05/01/1981

Hanoi November, 2013

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ACKNOWLEDGMENT

During the conduct of my thesis, I would like to give my sincere thank to advisors: Prof Dr Pete Ooi; Dr Edwin Bernal The advisors help me with detailed guidance and instruction so that I can complete my research Representatives from Southern Luzon State University, ThaiNguyen University, ICT and academic affairs together with teachers and staffs in ICT office has encouraged and helped from all the members in the class

When conducting the research, I receive the enthusiastic support and participation of directors and staffs of all enterprises that I have research

Beside that, I always receive the encouragement and support form my family

I would like to express my sincere thanks to the advisors, staffs participating

in the research and my family for supporting me a lot

Doan Thi Quynh Anh - Angel

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CONTENTS

ACKNOWLEDGMENT 2

TABLE CONTENT 3

LIST OF TABLE 4

LIST OF FIGURES 6

CHAPTER 1 INTRODUCTION 7

CHAPTER II REVIEW OF RELATED LITERATURE AND STUDIES 15

CHAPTER III METHODOLOGY 39

CHAPTER IV RESULTS AND DISCUSSIONS 45

CHAPTER V FINDINGS AND CONCLUSIONS 75

REFERENCES 79

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TABLE OF CONTENTS

Table 3.1 Factors affecting the adoption of the cost accounting system 40 Table 4.1 Respondents’ Age and Gender 46 Table 4.2 Respondents’ Position and Field of Specialization 47

Table 4.3 Perceived Level of Awareness and Understanding of Cost Accounting System 49

Table 4.4 Perceived Ease of Use of Cost Accounting System 52

Table 4.5 Perceived Usefulness of Cost Accounting System 54

Table 4.6 Attitude Toward Adherence to Cost Accounting System inCost

Management 57

Table 4.7 Summary Table on Respondents’ Perception and Attitude Towards Adoption of Cost Accounting System 59

Table 4.8 The relationship between the accountants’ and the managers’

perception of their level of awareness and understanding of the cost accounting system in travel agencies Crosstabulation 60

Table 4.9 Chi-Square Tests 62

Table 4.10 The relationship between the accountants’ and the managers’

perception on the ease of use of the cost accounting system in travel agencies Crosstabulation 63

Table 4.11 Chi-Square Tests 64

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Table 4.12 The relationship between the accountants’ and the managers’

perception on the usefulness of the cost accounting system in travel agencies

Crosstabulation 65

Table 4.13 Chi-Square Tests 66

Table 4.14 The relationship between the accountants’ and the managers’ attitude toward use of the cost accounting system in travel agencies Crosstabulation 67

Table 4.15 Chi-Square Tests 68

Table 4.16 Independent Samples Test 70

Table 4.17 Independent Samples Test 71

Table 4.18 Independent Samples Test 72

Table 4.19 Independent Samples Test 73

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LIST OF FIGURES

Fig 1 Classification of cost in travel agencies 31

Fig 2 Conceptual framwork 39

in the multi billion-dollar world-wide hospitality industry

Products and service in a travel agency are designed to satisfy special needs of consumers such as understanding the culture, tradition and the historical treasures of one locality, appreciating natural beauty of the place, experiencing the climate, foods, events and festivities of the area, and a lot of activities simply designed for sightseeing and for rest and recreation The demand for travel products and services

is not very stable as it easily changes due to instability of the climatic condition, and the economic and political situation of the particular tourism destination It therefore requires that players in the travel business to be more creative and innovative to anticipate changes in the business landscape in order to cushion the impact of slack time in the business

On one hand, it also requires that industry players fully grasp the characteristics of tourism and travel products to be able to organize business activities that optimally meet the needs of clients and ensure enhanced business performance on the basis of strict cost control It also requires strong organizational skills as well as

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understanding of the upstream and downstream links and costs which are, more often than not, not too easy to quantify as transfers of values take place with the transfer of intangible subject of business transactions While application of sound managerial accounting techniques and concepts is inevitably necessary, all must start from the solid understanding and appreciation of cost accounting and the adoption of appropriate cost accounting system

Summarily, determining the cost of products and services in a travel agency poses a great challenge for the firm’s accountants and managers in as much as the business’ price offerings depend largely on the relevant costs Doubly challenging is the implementation of a firm’s policy on cost allocations because this requires a deal

of rationalization so as not to overburden one product/service while others overburdened with unnecessary costs This therefore requires the identification and the use of appropriate cost driver to achieved full rationalization of the system Further, to achieve comparative and competitive advantages, it is necessary that, costs associated with the implementation of activities in major business functions along the value chains should be analyzed as to whether these are value-adding or non-value adding costs Obviously, only value adding activities are client-focused activities and therefore add to the achievement of the value expectations of the clients While cost accounting is a necessary requirement to achieve more in the travel business in Hanoi, less has been benefiting fully from it To determine the factors that drive the sector to adopt cost accounting system is the major reason why this research was conducted

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This research focused on determining the factors which affect the adoption of the cost accounting system of selected travel enterprises in Hanoi Specifically, it tried to find

answers to the following research questions:

1 What is the profile of the respondents in terms of gender, age, position and field of specialization?

2 What is the accountants’ and the managers’ perception of their level of awareness and understanding, ease of use, and usefulness of cost accounting system?

3 What factors are significantly affecting the attitude of the accountants and the managers of travel agencies in adopting a cost accounting system?

4 Is there any difference in the accountants’ and the managers’ perception of their level of awareness and understanding, ease of use, and usefulness of cost accounting system?

5 Is there any difference between the accountants’ and the managers’ attitude towards adherence to the cost accounting system in the management of costs in travel agencies?

The general objective of this research was to determine the significant factors affecting the adoption of cost accounting system for Hanoi-based travel agencies It seek to meet the requirements of the following specific objectives:

1 To determine the profile of the respondents in terms of gender, age, position and field of specialization

of cost accounting system

5 To statistically test the difference between the accountants’ and the managers’ attitude towards adherence to the cost accounting system in the management of costs

in travel agencies?

The following hypotheses were tested using inferential statistical tools:

Hypothesis 1: There is no relationship between the accountants’ and the managers’

perception of their level of awareness and understanding, ease of use, and usefulness

of cost accounting system and their attitude towards adoption of the same cost accounting system in travel agencies

Hypothesis 2: There is no difference in the accountants’ and the managers’

perception of their level of awareness and understanding, ease of use, and usefulness

of cost accounting system

Hypothesis 3: There is no difference between the accountants’ and the managers’

attitude towards adherence to the cost accounting system in the management of costs

in travel agencies

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In integration trends and competitive at present, enhance the capacity of Vietnamese businesses in particular and the economy in general in difficulties economic conditions is a matter of necessity of Vietnam One of the economic sectors

is considered Vietnam is the point of the travel industry In order to raise capacity of travel agencies, a series of measures was taken by tourism businesses to apply good governance over their enterprises such as : building Vietnamese travel photos and build good customer relations , manage travel activities , training of staff travel In measure , cost management is one of the most important issue for each travel agencies One of the instruments that helps manage cost efficiently is cost accouting system in cost mangement This research concentrates on finding the factors affecting the adoption of the cost accounting system in travel agencies

This research conduct to analyze relationship between factors affecting the cost accounting system in selected travel agencies This study will be significant to the following individuals and organizations:

For travel agencies and its key officers, this research indicates help finding the

key factors to apply the cost accounting system, they can use the results of this research to find the factors affecting to the adoption of cost accounting system in their enterprise

Based on the results of this dissertation, managers and accountants in travels agencies can making a plan to adopt the cost accounting management in their enterprise with the target such as managial cost, , saving cost, decision making

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Along with the system of the general theory of cost accounting system for internal management, the thesis will analyze and assess the current perception of cost accounting systems at some business travel company in Hanoi from which to finding the factors affecting of adoption of cost accounting sytem for travel agencies in the direction of modern cost accounting management system, which help the cost management and providing useful information for the decision of the administrator

With the aim of improving accounting system in travel company in Hanoi, and the number of enterprises tourism in Hanoil multiple, complex components business

in different fields, so the authors concentrate on research of the cost accounting system of 7 business describe the model tour travel service in Hanoi, including: A state-owned enterprise specialized in the field of business travel, business travel in all four areas received international, send international visitors, receives domestic tourists and domestic tourists on Hanoi recent years that is Vietnam Travel and Marketing transports Company Two enterprises belong to VietNam national Administration of Tourism are the State of Investment and Tourism Thang Loi and HaNoi Tourism company Three enterprises represent non-state enterprises as AsiaLink travel joint stock Company; New Horizons travel joint stock company, SaoMai travel company Besides, the authors also conducted to survey 25 travel companies in the area of Hanoi

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The following terms has been operationally defined:

Cost accounting system: A cost accounting system is a system designed for

managers to help them make decisions and includes; input measurement basis, inventory valuation method, cost accumulation method and cost flow assumption The type of costs that come into an inventory may be pure historical costing or standard costing

Cost accounting system is the process of collecting, analyzing and evaluating alternative causes of action A cost accounting system consists of five parts and they include input measurement, inventory valuation, cost accumulation, cost flow assumption and recording of inventory cost flows

Cost is the value of money that has been used up to produce something, and

hence is not available for use anymore In business, the cost may be one of acquisition, in which case the amount of money expended to acquire it is counted as cost In this case, money is the input that is gone in order to acquire the thing This acquisition cost may be the sum of the cost of production as incurred by the original producer, and further costs of transaction as incurred by the acquirer over and above the price paid to the producer Usually, the price also includes a mark-up for profit over the cost of production

More generalized in the field of economics, cost is a metric that is totaling up

as a result of a process or as a differential for the result of a decision Hence cost is the metric used in the standard modeling paradigm applied to economic processes

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related services to the public on behalf of suppliers such as airlines, car rentals, cruise lines, hotels, railways, and package tours In addition to dealing with ordinary tourists most travel agencies have a separate department devoted to making travel arrangements for business travelers and some travel agencies specialize in commercial and business travel only There are also travel agencies that serve as general sales agents for foreign travel companies, allowing them to have offices in countries other than where their headquarters are located

Level of awareness and understanding of cost accounting system is

perception of accountants and managers of cost accounting system base on their knowledge about accounting, cost, cost accounting system

Ease of use of cost accounting system is perception of accountants and

managers of ease of use cost accounting system The ease of use of cost accounting system is show ability of accountants and managers using the cost accounting system

managers of use of cost accounting system That is a wonderful tool for the management When it comes to measuring how wisely company resources are being utilized, if offers a lot of advantages to the several end users like management, employees, government, general public and creditors. The usefulness of cost accounting system is its effect and result of usefulness of cost accounting system for the accountants and managers work

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CHAPTER II

REVIEW OF RELATED LITERATURE AND STUDIES

This chapter authors reviews the related literature and studies on travel industry in Vietnam in general, Hanoi travel in particular This chapter provides the reader with sufficient theory about cost accounting, the usefulness of cost accounting system It will discuss theories framework and concepture framework , which is going

to be evaluated in following chapters

2.1.1 The tourism industry and the travel sector

During the 53 years of establishment and development, travel industry has always been interested in each period are determined location of tourism in the economic development strategy of the country's socio-suit bridge revolution In 53 years of development , not a long time for the development of an industry , but can also see the strong upturn in both quantity and quality of Vietnam Tourism , is a in important aggregate economic sectors, bringing profound cultural content that is interdisciplinary, inter-regional and socialize high growth rate in recent times , including in crisis conditions Asian economic and natural disasters, widespread epidemics, global conflicts and local wars and terrorism in many parts of the world in recent years

Vietnam tourism in 53 years of development, tourism industry has achieved these results:

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1 Innovation , improve awareness about tourism perspective : The whole industry has focused efforts to mobilize the intellectual and theoretical studies and tests , practical summary of tourism development in the country, forming, proposed system and gradually complete the view, guidelines and policies for tourism development with the Party and the State

2 Apparatus and management capacity of state for tourism , business travel system is perfected , activity gradually adapt to the new regime

3 Mobilizing more and more resources to build infrastructure , improve the quality and diversification of tourism products

4 The propaganda and promotion , tourism promotion is enhanced In recent years , the tourism industry has focused on the promotion of tourism in both the domestic market and internationally Promotion work is more focused : Established Tourism Promotion Bureau ; had promotion for a period of 5 years ; gradually improved professionalism , quality of events organized better Tourism has actively coordinated with Vietnam Airlines , Vietnam embassies abroad, the Ministry of Culture - Information , news agencies and newspapers , broadcasting , organizing many events tourism promotion overseas

5 International cooperation is expanding , exploiting external resources

6 Achieve and maintain a high growth rate , the effect of socio- economic growing and comprehensive

There is such a result , the entire tourism industry has actively implemented seriously and synchronization solutions, both at work perfecting the policy, state

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management, broadcast promotion, link and coordinate local businesses, enhance the quality of services By the end of 2012, Vietnam had 1120 international tour operators; 11,840 tourist guides have been issued cards, including cards 4,809 instructors and 7,031 local tourist guide card international travel and the total number

of tourist accommodation establishments all over the country is estimated at 13,500 to 285,000 chamber, in which: 57 hotels 5 star 147 hotels 4 star,335 hotels 3 star

Vietnam Tourism to identify some key tasks in 2013 include : Continue to implement the development strategy of Vietnam's tourism in 2020, with a vision to

2030, deployment of the planning scheme, other resorts according to the master plan

on development of Vietnam Tourism 2020 vision 2030 after being approved by continued deployment tasks improve the quality and efficiency of tourism statistics; promote activities E - tourism marketing and branding Vietnam tourism logo and slogan associated with the new deployment scheme to attract tourists from 8 key tourism markets of China , Japan , Korea , Malaysia , Thailand , Australia , France , Russia , to exploit tourism development Ha Long Bay and a number of other prominent points to ensure the sustainability and high economic efficiency, image building heritage tourism Vietnam, Ha Long Bay

2.1.2 Travel business in Hanoi

Hanoi is located and beautiful location, conveniently, is the capital, the center

of politics, economy, culture scientific, and important traffic of the country As one of the largest tourist centers of the country, Hanoi plays a very important role in the tourism development of the country in general and in particular of Tonkin International tourist arrivals to Hanoi for about 30 % of visitors to Vietnam With the advantage of historical, cultural capital , domestic tourists to Hanoi at the forefront of

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the country Hanoi is also a center for receiving and distribution of tourists travel to the northern region and the other regions in the territory of Vietnam as well as to countries in the region

It has long become destinations Hanoi attracts international travelers largest country by ancient beauty , quiet , elegant Hanoi tourism natural resources and rich humanistic , systematic Hanoi lakes make up a very particular landscape values of Hanoi West Lake , Hoan Kiem Lake , Quan Son Lake , Suoi Hai , Van Tri special dress relic Thang Long Imperial Citadel , Giong festival at Phu Dong temple and temple Soc , Ca tru is recognized by UNESCO as a world cultural heritage , in addition, the system epitaph Dr Le Mac at Van Mieu Quoc Tu Giam was recognized

as a UNESCO world documentary heritage of world program of UNESCO memories Thus, Hanoi has always been appreciated by the international tourists as an attractive destination

This is more significant when the Hanoi area was expanded 3.6 times the old area , with a population of over 6.5 million people , opens up the potential for the tourism industry With nearly 5,000 sites , of which 803 sites have been ranked , ranked first in number of historical monuments , eligibility to develop cultural tourism , historical , spiritual In addition to the advantage of monuments , landscapes historical land of thousand years of civilization , Hanoi is emerging as the ideal location for eco-tourism , leisure and entertainment

Along with the expansion of the administrative boundaries of Hanoi more unique tourist destinations catering Hanoi currently has a number of eco-tourism service quality is relatively good Tan Da, King Pond, about Green - Suoi Tien, Asian

Since several years , Hanoi has always been a number of prestigious travel magazine as the World 's leading Travel and Leisure ( U.S ) , Smart Travel Asia ( HKG ) held a vote and won the title of Top 10 tourist destinations most of Asia

International visitors to Hanoi increasing number of customers rose by an average of 18-20 % In 2008, Ha Noi welcomes 1.3 million , in 2009 due to the global economic crisis and the disease is 1.02 million visitors ; 2010 with a celebration event in 1000 thousand years of Thang Long - Hanoi Cabinet and the National Tourism Year, Hanoi arrivals increased, the total number of 1.7 million;

2011 welcomed 1.84 million international passengers; 2012 Hanoi welcomes over 2 million international tourist arrivals

Markets domestic tourists to Hanoi large proportion of the country 's leading , with an average annual passenger traffic accounted for over 20 % of domestic tourists

in Vietnam In 2002, Hanoi welcomes 2.8 million , by 2009 had brought 9.2 million ,

in 2010 to reach 10.6 million; in 2011 to reach 11.6 million; in 2012 to reach over 12 million passengers

Domestic Tourists to Hanoi with many different purposes and from all provinces of the country , in which visitors to Hanoi for tourism purposes traveling,

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visiting relatives and healing Visitors to in Hanoi , stay at hotels 38.6 % , 24.4 % Guest House , Lodging and 21.8 % in the friends and relatives about 15.2 % ( by relatives and visitors rate Hanoi to therapy rather large ) Shopping is a pastime of tourists , especially domestic tourists Spending on shopping accounted for the highest proportion , 27.7 % of the total expenditure , followed by eating 22.5 % , 22.1

% accommodation , transport and entertainment respectively 10 , 2 and 9.4 %

On Hanoi now has nearly 500 International travel agencies and nearly 500 domestic travel agencies, has about 50 companies and individual business households transporting tourists Hanoi focused cultural institutions of the country such as the Opera House , the National Cinema Center, the major museums, the performing arts theater folk as rowing, water puppetry very attractive with international travelers and domestic

Park system as Lenin Park , Thu Le Park , Park Dong Da , Youth Park , West Lake Water Park , Bao Son Paradise Park , Vietnam Phu Thanh Chuong are increasingly becoming tourist attractions are concerned

Activity culinary tour of Hanoi were strongly developed , the high socialization , has given high capital position system travel the world and dining area The dining establishments in Hanoi last time the rapid development of rich and diverse ethnic restaurants like Thai restaurants , Japanese restaurants , Korean restaurants to bars , caffe , pubs snack of the world's major corporations like KFC , Lotteria were present in Hanoi , meet the culinary needs of the great majority of visitors and residents of Hanoi

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Food service establishments , food restaurants such as Europe , Asia , coffee and bar facilities developed increasingly In recent years the city has made the construction of pilot Tong Duy Tan street food to introduce culinary arts and Hanoi, Vietnam

In the future , the direction of Hanoi is the optimal exploitation of valuable natural resources , the value of cultural heritage , historical diversification and the development of tourism products typical of the capital Hanoi focuses mount tourism development with protection of natural resources and the environment Improving the quality of products and services for tourism, and improving the quality of human resource development Hanoi tourism as a whole

2.1.3 Accounting as the language of business

Traditionally, accounting has been defined as the process of recording, classifying and reporting the fianancial activities and transactions of a business enterprise The process of recording and classifying business transactions is commonly referred to as bookeeping The bookkeeping function of accounting skill forms the foundation of much accounting activity An accountant is usually defined as

“one who is skilled in accounting” Ta the beginning of the twentieth century, however, the role of accountantdid not extend much beyond a bookkeeping function, that is, the keeping od records according to a set of well-defined rules and procedures

At this time, accountants were generally reffered to as “bookkeeper” In the bissiness world of the twenty-first century the activities and responsibilities af accountants extend far beyond mere bookeeping and the keeping records They include the interpretation and analysis of accounting report, the design and operation of computer

Accounting has a wide-ranging fuanction and hence abroad definition of the field of accounting is needed, one that embraces the variety of professional activities engaged in by accountants Serveral years ago a committee og the American Accounting Association defined accounting beyond its mere traditional definition (the recording, classifying and reporting of transaction) This committee defined accounting in a broader and more modern context as the process of identifying, measuring and communicating economic information to permit informed judgements and decisions by users of information

Accounting is called the language of the business in the sense that the responsibility of learning accounting is very similar to the task of erudition a new language ,it is complicated by the fact that heaps words used in accounting mean almost the same but not fairly the same thing as the identical words scrounging in everyday non -accounting usage

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2.1.4 Cost accounting and cost accounting system – uses and importance

Cost accounting is a process of collecting, analyzing, summarizing and evaluating various alternative courses of action Its goal is to advise the management

on the most appropriate course of action based on the cost efficiency and capability Cost accounting provides the detailed cost information that management needs to control current operations and plan for the future Since managers are making decisions only for their own organization, there is no need for the information to be comparable to similar information from other organizations Instead, information must be relevant for a particular environment Cost accounting information is commonly used in financial accounting information, but first we are concentrating on its use by managers to make decisions

Unlike the accounting systems that help in the preparation of financial report periodically, the cost accounting systems and reports are not subject to rules and standards like the As a result, there is wide variety in the cost accounting systems of the different companies and sometimes even in different parts of the same company or organization

A method of accounting in which all costs incurred in carrying out

an activity or accomplishing a purpose are collected, classified, and recorded This data is then summarized and analyzed to arrive at a selling price, or to determine where savings are possible.In contrast to financial accounting (which considers money as the measure of economic performance) cost accounting considers money as the economic factor of production

Cost accounting is an approach to evaluating the overall costs that are associated with conducting business Generally based on standard accounting

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practices, it is one of the tools that managers utilize to determine what type and how much expenses is involved with maintaining the current business model At the same time, the principles of cost accounting can also be utilized to project changes to these costs in the event that specific changes are implemented

When it comes to measuring how wisely company resources are being utilized, cost accounting helps to provide the data relevant to the current situation By identifying production costs and further defining the cost of production by three or more successive business cycles, it is possible to note any trends that indicate a rise in production costs without any appreciable changes or increase in production of goods and services By using this approach, it is possible to identify the reason for the change, and take steps to contain the situation before bottom line profits are impacted

to a greater degree

Product development and marketing strategies are also informed by the use of cost accounting In terms of product development, it is possible to determine if a new product can be produced at a reasonable price, considering the cost of raw materials and the labor and equipment necessary to produce a finished product At the same time, marketing protocols can make use of this type of accounting to project if the product will sell enough units to make production a viable option

Cost accounting is helpful in making a number of business decisions By weighing the actual costs versus the anticipated benefit, it can help a company to avoid launching a product with no real market, prevent the purchase of unnecessary goods and services, or alter the current operational model in a manner that will decrease efficiency Whether utilized to evaluate the status of a department within the company or as a tool to project the feasibility of opening new locations or closing

Estimating the accurate cost of products is critical for profitable operations A firm must know which products are profitable and which ones are not, and this can be ascertained only when it has estimated the correct cost of the product Further, a product costing system helps in estimating the closing value of materials inventory, work-in-progress and finished goods inventory for the purpose of financial statement preparation

There are two main cost accounting systems: the job order costing and the process costing

Job order costing is a cost accounting system that accumulates manufacturing costs separately for each job It is appropriate for firms that are engaged in production

of unique products and special orders For example, it is the costing accounting system most appropriate for an event management company, a niche furniture producer, a producer of very high cost air surveillance system, etc

Process costing is a cost accounting system that accumulates manufacturing costs separately for each process It is appropriate for products whose production is a process involving different departments and costs flow from one department to another For example, it is the cost accounting system used by oil refineries, chemical producers, etc

Still further refinement to costing accounting systems include JIT-costing, back-flush costing

Managers rely on cost accounting to provide an idea of the actual expenses of processes, departments, operations or product which is the foundation of their budget, allowing them to analyze fluctuation and the way funds are used socially for profit It

is used in management accounting, where managers justify the ability to cut expenses for a company in order to increase that company´s profit As a tool for internal use, versus a tool for external users like financial accounting, cost accounting does not need to follow the GAAP standards (Generally Accepted Accounting Principles) because its use is more pragmatic

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It creates a financial value out of the production of a product, measuring currency that is nominal into units that are measured by convention By taking recorded historic costs a bit further,it allocates a company´s fixed costs over a specific time period to what items are actually produced during that period of time, creating a total cost of product production Products that were not sold during that period of time produced a "full cost" of those products, recording them in a complex inventory system that uses accounting methods of its own that are in compliance with the GAAP standards Managers are then able to focus on each period's results as it relates to the

"standard cost" of any product

Any distortions in expenses that were caused by calculating what the overhead

of a product is versus what a unit cost is for companies that specialize in only one specific product are very minor in industries that mass produce that product with a low fixed one Understanding why it varies compared to what was actually planned helps a manager to save a company money by taking actions that are appropriate to correct that variation in the future Variance analysis is a very important part of cost accounting because it breaks down each variances into many different components of standard and actual one Some of these components are material expenses variation, volume variation and labor expenses variation

It is a very important part of the management accounting process In order for managers to determine the best methods to increase a company's profitability, as well

as saving a company money in the future, cost accounting is a necessary system in the management of a company's budget, providing important data to analyze fluctuation

in company production expense

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Executive level pay is based upon company performance If the performance

of a company is not reported in a proper manner, executives make money that far exceeds what the business is capable of and creates a false picture of a company's performance This false reporting causes the stock market to balloon by rewarding stock to companies who do not deserve it, and these methods have a bad effect on our economy Business accounting that honor the GAAP (Generally Accepted Accounting Practices) creates a transparent persona, an air of trust and respect, from the users of their financial statements

2.1.5 Cost management in travel agency

The implementation of a cost accounting system is an important step for a service business Implementation begins with identification of the correct costing system for the business, moves on to deployment of the system and finishes with post-deployment support to train employees on how to use the system effectively Best practices in cost-system implementation focus on all three parts of the implementation process

There are cost accounting systems designed for the sole proprietorship on up

to the largest multinational corporation It is important remember that bigger isn't necessarily better Service business owners should look to implement a cost accounting system that is matched to the complexity of their business Less-complex companies may be best using an off-the-shelf software system or a system that is integrated into their current accounting software However, companies that have many products or complex manufacturing processes may wish to seek a more customized solution

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Implementing a cost accounting system is much easier when you only have to implement the system once Managers should be careful to choose a cost accounting system that is scalable to the company For example, even if you only manufacture a handful of products currently, you may wish to implement a cost accounting system that can handle more products as your offerings grow

As your company implements a cost accounting system, it is important to involve employees in the process Employees who are involved in the process of implementing the system are more likely to have bought in to the transition Not only does this help employees understand the system more quickly, but these employees can serve as ambassadors to other employees who weren't involved in implementation Often, the employees who were involved in implementation are more successful in increasing trust of the new system than management This occurs because other employees view these employees as having less incentive to blindly approve of the implementation

Most service business owners are experts in their fields, but few are experts

in the implementation of accounting systems as well Managers and small-business owners should consider consultation with a professional accountant before spending time and resources choosing and implementing a cost accounting system The money that you spend seeking professional help can buy you time to focus on business operations However, service business owners who seek consultants should be mindful and ask the consultants if they receive any commission from the makers of the cost accounting system If so, you may wish to seek the advice of someone more impartial

- The fixed cost: The cost does not change when the level of activity changes (to the extent appropriate), but when 1 unit based, the costs vary inversely with the level of activity However, when the level of development activities beyond the scope of compliance, cost forced to change to fit in with the development of the activity level Usually the fees include: equipment depreciation costs, advertising costs, rent,

- Mixed Cost: Is the cost of which itself includes variable costs and fixed fee element

In particular, the charges reflect the cost basis, at least to maintain the service and to keep the service always ready to serve the state While the variable costs reflect the actual service or in excess of the base rate so this section will vary proportionally with the level of use on the baseline

The focus of management accounting is the field of cost, so the organization of scientific management accounting and reasonable will ensure information quality, reliable, and purpose of management accounting more charge is to provide the appropriate cost information, useful, timely decision making of corporate governance

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So, for the cost and management accounting not only aware of the cost, such as

financial accounting, cost is perceived by the method of decision-identifying

information Cost may be the actual cost associated with the daily business operations

while implementing, testing, decision-making, can also cost is the estimated cost to

implement the project, the costs lost when selecting schemes ignore business

opportunities Meanwhile in management accounting need to pay attention to the

choice, comparison purposes, the business environment rather than focusing on

proven by evidence and documents

Fig 1: Classification of cost in travel bussiness

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Cost accounting methods tourism services is a method or system of methods used to set the cost of services according to the specified object There are usually two basic cost accounting methods

- Direct method: This method costs incurred are recorded directly to the set of objects This method is simple, easy to do but cannot apply to all business expenses incurred in business travel services tour because there are costs incurred are common

to many objects should not be set directly to each individual object, only those expenses directly related to the cost object collection, the new accounting method can

be applied directly

- Indirect accounting method: This method is often used for expenses related

to the number of objects, typically general production costs, management costs the content of this method is that in the period accounting follow-up, sorting and collection expenses have the same content in the same window, card accounting End

of the general public get the totals, and then use the appropriate criteria to allocate and account for each expense

The collection and distribution can follow these steps:

+ A set of costs related to the number of objects (before throwing on the basis

of the cost incurred documents, recorded in accounting, accounting card details, then the end of the period, aggregating data from windows, card information to calculate a total cost for each content)

+ Select the rational allocation criteria and content for each cost allocation: allocation criteria usually targets closely related types of costs need to be allocated Need to pay attention to the validity of this criterion because it affects the accuracy

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The costs need Total cost should be allocated x allocation criteria for each objectto be allocated for =

each object Total allocation criteria

To get the full information, useful for making the right decisions, executive management and business operations of effective corporate governance in addition to the past and the information obtained from the detailed accounting, the identifiable information to predict the future is also particularly concerned administrators The information related to the future affect the decision of the corporate governance

of many kinds such as: information on domestic, regional and international information on the line of development policy industry and the country's ability to change the revenue, expenses and results of business enterprise However, not all information in the future is appropriate for making decisions of corporate governance To quickly make management decisions in accordance with each specific case, administrators need to fully provide the appropriate information related to the future

To crawl the future, the management accountant make a list of the necessary information, go to the Marketing department of the business The information collected includes: number of tours in the coming period, the price of the tour, expected revenues, expected expenses incurred for each tour offers

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information of business management, accounting management incorporates the analysis of this information to advise administrators business plan choice Businesses to survive and stable development should have a reasonable business strategy So should have expected more, specific to each period as well as the production process This means that need to estimate production The process of building cost estimates associated with the business of governance, facility conditions promote positive, proactive, innovative facilities and the feasibility of the estimates were made, at the same time facilitate strengthen inspection and control Business processes of the enterprise consists of many processes are closely related to each other Each different process management requirements also vary, requiring specific target estimate to suit each specific business process In the enterprise business system production estimates include many targets, but estimates of consumption is a major factor affecting the entire line estimation of the business, its impact and driven to the other estimates Consumption estimates as the basis for estimation of production or purchase to meet the demand for the production or sale of products Based on production estimates for estimation of production costs which determine the estimates defined business results Therefore, in the estimation process

to determine the basic estimates as a basis from which to build a system estimates the scientific production estimates, reasonable, feasible basis for organizations operating business activities to achieve the highest efficiency

There are two methods of estimation of business is flexible static estimates and estimates the cost estimates for a proposed activity level, and estimate flexible cost estimates for a level of activity can occur Data from static estimates are important in planning but has little effect on the control because the actual level of activity rarely coincides with the plan In contrast, the estimated useful flexibility for

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administrators to control activities by comparing the actual results and estimates data

for the same level of activity

System production estimates include estimates as cost, revenue, estimation results, the contents include:

* Estimated consumption: this estimate is built for all services, each service, major

service groups, for each period and each base unit Therefore, consumption estimates should be made first Consumption estimates are based on estimated consumption and unit price Consumption estimates include estimates of volume, revenue and collection estimates

Revenue estimate = estimate x unit price of consumption products

The amount of debt in the period = Amount collected in the period previously + sales period estimates obtained by money

* Cost estimate: Includes estimates the cost of direct materials, direct labor cost

estimates, general production cost estimates, cost estimates, sales and corporate

+ Estimated direct materials cost

Direct material cost estimates = product production estimates x The material cost norms directly

+ Direct labor cost estimates

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Cost estimates of direct labor = labor time demand estimates x unit price of quota time

+ Manufacturing cost estimates

The purpose of the overall production cost estimates indicate the level expected of all indirect production costs General production costs include all remaining costs beyond the cost of direct materials and direct labor costs General production costs are divided into variable production overheads and production overheads Estimated variable production overheads: If the variable production overheads are built for each cost element for a unit operation, similar estimates for the cost of direct materials and labor costs directly If the variable production overheads is determined

by a percentage based on the direct variable costs, variable direct cost estimates to estimate the variable production overheads

Estimate the overall production cost is estimated as the total amount spent during the planning period and when estimating cash, excluding depreciation + Sales cost estimate and cost management business

Because nature is the indirect cost estimate for these expenses is similar to the estimation of overall production costs May own up selling expenses and administrative costs as well as business-specific estimates of each factor variable

Estimated = variable costs estimates x Selling

sales the number of products sold variable

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For selling expenses and general and administrative expenses fixed now, so do not change in a certain limited number of product consumption changes, so it may be based on cost of sales and manage business fixed costs of the period of implementation to determine the estimated selling expenses and administrative costs fixed business plan period

* The estimated business results: On the basis of estimates of revenue and cost of

sales estimates and estimates of cost of sales and expenses for business management business performance estimation Estimated business results will be presented in the form of ensuring balance, also known as cost estimates business results by the method

of direct costs

2.4 Conceptual Framework

From the theories and concept above, I suggest the relation of variables to factors affecting the adoption of cost accounting system in travel agencies as follows:

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Fig 2 Conceptual Framework

Adherence to Cost Accounting System

Sampling method, data collection method and tools for data collection are discussed in this chapter Finally, statistical tools to process and analyze the collected information

for the dissertation research shall be tackled

3.1 Research design

In this research, four groups of parameters were used to focus on the aspects of perception of Level of Awareness and Understanding of Cost Accounting System, perception of easy of use of Cost Accounting System , perception of usefulness of Cost Accounting System, Attitude of the Accountants and the Managers of Travel Agencies in Adopting a Cost Accounting System All the variables are tabulated in Table 3.1 There are four independent variables,specifically,” perceived of Level of Awareness and Understanding” "perceived usefulness", "perceived ease of use" Each independent variable measured by four to ten questions related cost accounting system A total of 23 questions were conducted to four aspects of the adoption the cost accounting system in travel agencies

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Table 3.1 Factors affecting the adoption of the cost accounting system

Perceived Level of Awareness

and Understanding

of Cost Accounting System

Personal knowledge of cost accounting system in the enterprise

where the respondents are employed Ability to apply the cost accounting system in performing assigned job Ability to determine the exact cost due to respondents’ consistent

application of the accounting system

Confident in the performance of one’s job due to consistent application

of the accounting system

Perceived Ease of Use of Cost Accounting System

Ability to easily learn to use the cost accounting system

Ability to easily access information from support unit whenever these are needed to ensure that cost

accounting system works Ability to easily interact with information support unit for cost management information system

Ability to easily monitor the movements in cost information

Perceived ability of the information support unit to extend help in facilitating the management of cost Perceived ability to easily access cost accounting information and

feed information to the management

Perceived Usefulness of Cost Accounting

The use of cost accounting system improves the quality of respondents’ work

The use of cost accounting system increases the respondents’ work productivity